You might have a personal goal to save $10,000 a year. This is a large amount of money that can be a major milestone.
This money is perfect to put in your rainy day fund, for a big purchase such as a home, or for anything else you wish to save this year.
Saving five figures may seem daunting at first but you can reach $10k much easier than you think.
If you plan to save that much money in a single year, you must first break down your income. Then you can create a plan you’ll follow.
You may need to wait a full year for this process, depending on your income and finances. You might be able save up to $10,000 in less than a month (and save even more! ).
These simple tips will help you achieve your savings goal.
Table of Contents
Breaking down $10,000
Savings Tips for $10,000
- Change your mindset
- Create a simple budget
You should review your expenditures thoroughly - First, pay yourself
- Earn More Money
- Track your progress
- Celebrate every month or milestone
Final Thoughts
Breaking down $10,000
Spend a few moments analyzing the amount before you start or make your plan.
It can be intimidating to see so much money, but when you break it down into smaller amounts, you will realize that the amount is not as large as you thought.
If you divide $10,000 by 12 months, then you get $833.33 a month. It is also a lot of money per month to save. When I was first saving up for my first $10,000, it was definitely nerve-wracking.
You can also break down the dollar amount to smaller amounts, as many people prefer visuals.
If, for instance, you get paid bi-weekly by your employer, this is equivalent to $384.61. If you break that down daily, it would be $27.39 a day.
It’s not as frightening, is it? Saving five figures in a single year is not easy, but if you break it down into smaller chunks and understand what’s involved, it can be easier.
Saving $10,000 in a Year: How Much Do You Need to Save?
Monthly $833.34
Bi-Weekly$384.62
Weekly$192.31
Daily $27.40
Savings Tips for $10,000
What next, now that you have seen some numbers?
Follow these essential tips to save up to $10,000 in this year. (Or even less if you’re more aggressive!) ).
- Change your mindset
I strongly believe that if you want to save $10,000 in one year, your mindset is the key. You must not only believe that you can achieve this goal, but also find ways to manifest the money. You are thinking positively, and visualizing yourself achieving this goal.
The mindset and attitude toward money is what holds back most people from financial success. Create a plan to help you succeed and start looking at money like a tool. It’s okay to have some setbacks. But don’t let them stop you.
You must commit to saving $10,000 no matter how difficult or easy it is. You will know what to do, and you’ll be more focused on reaching your goal.
- Create a simple budget
You may have heard the term budget before. The reason it’s repeated so often is because it is SO important to get started.
It’s not fun to organize your finances, save money, or figure out how you can cut back — but it is necessary!
Your budget can help you achieve your savings goal. Budgets help you identify wasteful expenditures, show where you can reduce expenses and reveal income gaps.
Budgeting 101 is a great place to start if you want more information.
You should review your expenditures thoroughly
If you create a budget, or use a calendar to track your budget, you can keep an eye on all of your expenses. You’ll have to go one step further depending on your income.
You need to keep a closer eye on your spending if you are already on a limited budget.
Housing, transportation and food are usually your three biggest expenses. This is a good place to begin! You may also have to do some other things so that you can put the extra money towards your savings.
Negotiate lower bills. You would be surprised at how much money you can save by negotiating lower bills. Just give the company a ring. Many customer service representatives will work with you if you have a good reputation, are a long-time client, and are polite. Use a service such as Trim or Billshark.
Can you reduce your big expenses significantly? If you have a mortgage it may not be possible to do much, but you could move for a cheaper rent if you’re renting. You can drive less to save money on gas and car maintenance. Do you keep track of your grocery bills and couponing? ?
You might not save a lot of money. It’s a great place to begin and will help you be more frugal as you try to save $10,000 in this year.
- First, pay yourself
Pay yourself first is another important tip to help you develop better savings habits. This concept is so simple, but it’s easy to overlook.
As soon as your income is deposited into your checking account, a certain percentage or amount will be transferred to your savings and/or investment accounts.
Before you pay bills or spend any money, save it.
Simple, right? This process can be made easier by automatically saving a certain amount of money on specific dates. Almost every bank has the ability to automate this rule. You are no longer tempted to use or spend the money first and you’re putting it away on a regular basis.
This idea was so obvious a few short years ago and yet I didn’t do it. After I heard about it, I made the necessary changes. I haven’t looked back since. I have been able to save enough money for a whole year of living expenses.
- Earn More Money
You may have realized that saving $10,000 a year is difficult if you’ve looked at your budget. This is a large amount of money, and depending on your income it may not be possible to save $800+ each month.
Before you give up on your goal, consider putting together a plan to earn more money.
You might earn more money to ease the pressure of saving $10k. This will help you reach your goal faster.
We live in an age where side hustles are a great way to earn extra money. What can you do now? Here are some things you can do this year.
Ask for an increase and save it.
Negotiate a better salary by switching jobs
If you are a specialist, consider freelancing or consulting on the side.
Participate in the gig economy.
Flipping items to make money, such as thrift store flipping.
Start an online business. (Note that it can take some time to earn money so this might not be your best option if you are looking to save $10k per year.)
How can I quickly save $10,000?
You can save up to $10,000 in a year by increasing your income. You can either increase your salary, and then save the difference, or you can earn extra income to help you progress your savings.
- Track your progress
It’s important to continue tracking and monitoring your progress when you set yourself goals.
Setting a financial target like $10,000 in an year is easy, but it’s important to monitor your progress each week, month and quarter.
You may track your progress differently than someone else. Do what is most convenient for you. You can see your progress and whether you need to pivot if you are lagging behind.
You can track your progress by using personal finance software or apps. You can find a lot of apps and software. For example, Personal Capital is free.
You can also go back to the basics by using a spreadsheet that has some color-coding and can be used for your own personal progress tracker.
- Celebrate every month or milestone
A year may seem long when you’re starting out, but it will pass quickly once you get going. It’s easy to start out excited and enthusiastic, but soon your enthusiasm may wane or you might become bored.
Celebrate your achievements and progress to keep you motivated and avoid boredom. You want to save money but you also want to reward yourself. You could treat yourself to something small at the end each month, or every time you reach a certain target.
You can look forward to these celebrations, which keep the process interesting and fun. Whatever you decide to do, don’t let your celebrations derail your savings goals for the year.
Final Thoughts
It is not easy to save $10,000 a year, but it can be an important milestone. It will hopefully motivate you to continue to practice good financial habits, and to want to invest or save more money.
You can save this much money if you break it down, reduce expenses and create a plan. You may need to work harder than others, but the satisfaction you get from your effort will be well worth it.
Last but not least, embrace any setbacks you may encounter. These are valuable learning experiences that will still influence your decision-making in the future when it comes to money.
